Licensing Deals And Decisions: UMG And YouTube Agree, BMI Upheld On Appeal

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– BMI logo

The U.S. District Court of Appeals for the Second District affirmed BMI’s consent decree win over the Department of Justice, while Universal Music Group and YouTube confirmed they’ve reached a sweeping, multi-year licensing agreement, both on Dec. 19.

The Second Circuit agreed with Judge Louis L. Stanton’sSept. 16, 2016 decision that the BMI consent decree allows for the practice of fractional licensing in which portions of songs may be licensed to various songwriters or publishers.

Fractional licensing is of particular interest in Nashville, where multiple co-writes have become the norm.

“This is a massive victory for songwriters, composers, music publishers and the entire industry,” BMI President/CEO Mike O’Neill said in a statement. “We have said from the very beginning that BMI’s consent decree allowed for fractional licensing, and we are incredibly gratified that Judge Stanton and the Second Circuit agreed with our position. We thank all the songwriters, composers, publishers and organizations who supported us throughout this process, which unfortunately, has been a nearly two-year distraction from our original intent which was to update our outdated consent decree and modernize music licensing.”

Meanwhile, MusicBusiness Worldwide reports that UMG and YouTube inked a “new, global, multi-year agreement” seven months after the video streamer struck a similar deal with Warner Music Group – and is near another deal with Sony.

“We’re thrilled to strengthen our partnership with Universal Music Group,” YouTube CEO Susan Wojcicki said in a statement. “This agreement means we can drive more value to the industry, break and support more artists and deliver an incredible music experience to fans around the world.”

Added UMG Chairman/CEO Lucian Grainge, “This important step forward provides our recording artists and songwriters improved content flexibility and growing compensation from YouTube’s ad-supported and paid-subscription tiers, while also furthering YouTube’s commitment to manage music rights on its platform.”